A fiduciary advisor is a financial advisor who is legally obligated to work in your best interest. A lot of times in the financial services industry, it isn’t very clear if your advisor is acting as a fiduciary or not. In financial advising, there are two standards, fiduciary and suitability. Fiduciary, as mentioned before, is always working in the best interest of the client, and if you aren’t, you have to disclose it. Suitability is looking if something is suitable for you. Though this may sound alright, it’s actually not. Technically, a 10 million dollar mortgage could be suitable for you, but it wouldn’t be in your best interest. Suitability doesn’t always mean it’s the right choice.
In the financial industry, there are a lot of sales transactions. For example, if you look at annuities, life insurance, and health insurance, these are all things that are sold to people by salesmen. A financial plan isn’t something that should be sold to you. Instead, you should have a fiduciary advisor going through the process with you to help determine the best course of action to reach your financial goals.
Ultimately, a fiduciary fee-only advisory firm is the best place to go if you aren’t looking for your advisor to sell you things.